Enterprise and Regulatory Reform Bill

Baroness Turner of Camden Excerpts

Wednesday 14th November 2012 Lords Chamber

[Baroness Turner of Camden]

My Lords, the Minister will not be surprised to learn that I find much of this Bill quite unacceptable. The section dealing with employment is apparently based on the notion that employment rights are responsible for the lack of employment opportunities. I believe this to be untrue. Such evidence as there is appears to indicate that unemployment is due to a lack of growth. The interesting report from the noble Lord, Lord Heseltine, which has already been mentioned, refers to the need to balance our economy and, in particular, the need for support for manufacturing industry. The Bill does nothing to address these important economic problems.

Making it easier to fire workers—which is part of the intention of this Bill—will not create more jobs, but will increase the feeling of instability among those in jobs. The Government have already introduced regulations requiring a tenure of two years in a job before action for unfair dismissal can be attempted. This already makes it impossible for many women in part-time employment, most of whom do not have a two-year tenure in a job, to utilise the procedures anyway. The Bill lays down procedures involving ACAS mediation, including reference to a conciliation officer, and the emphasis is on a settlement rather than process to a tribunal, which apparently—according to the Government—must be avoided. A certificate will be required before the employer can take the next step; then a legal officer has to be involved before the tribunal can consider the case. If the employee eventually makes it to a tribunal, the hearing is by a judge alone —not the current set-up involving lay-people with some knowledge of working practices. There is also a charge to the employee in order to get his case heard. There is a great deal more complication set out in the Bill and all of it is clearly proposed in order to make it as difficult as possible for an employee to activate rights for which many of us fought hard in the last century.

There are further problems for employees. Health and safety at work regulations are to be amended. The Government claim that this will cut down spurious personal injury claims, but it should be remembered that the Health and Safety Executive figures for last year show that 173 people died in workplace accidents and 22,433 sustained serious injury. The Government’s current proposals would involve less attention paid by employers to workplace safety and greater expense to the taxpayer through NHS costs and welfare payments to workers who have been injured.

Many workplaces are inherently unsafe. Some industries like construction have many accidents, but the workers who do this necessary work have the right to maximum protection and employers have an obligation to provide as safe a working environment as they possibly can. There has already been some reference by my noble friends to Clause 61, which was introduced at a late stage in the House of Commons. It would radically change the way injured workers claim compensation from their employers. If an employer breaches health and safety regulations and injures an employee, that employee will no longer have a consequent right to compensation. He or she will have to prove negligence and the burden of proof will transfer to the injured worker, who will find it harder to claim compensation as a result. Litigation will be more protracted and costly.

What about insurance? When I was much younger, I worked in the accident claims department of a major insurance company. I saw little evidence there of so-called compensation culture; on the contrary, getting compensation was pretty tough. I remember often feeling sorry for injured workers who, in those days, had to fight very hard to get any compensation at all. Because they needed the money, they often settled for much less than the injury was worth. It seems to me that what is clear is that this legislation, if it reaches the statute book, will result in increased insurance premiums.

The sections of the Bill to which I have referred relate to improvements over the years intended to benefit the workforce. At a time when poorer households are already being hit by rising food prices, soaring gas and electricity bills, and stagnant wages, the removal of employment rights are bound to be deeply resented.

I hope that the Government can be persuaded to reconsider some of the provisions in the Bill. If not, we shall have to attempt amendments in Committee and on Report. It should be understood that in this country we have, I regret to say, a low-wage environment. An employer who profits from employing low-paid workers benefits from subsidies from the taxpayer via the benefits system. Landlords, in London particularly, charge enormous rents for one-bedded flats also are subsidised by the taxpayer via housing benefit. But it is always the worker who is described as a scrounger and is told that he or she is lucky to have any sort of job, and not to expect any employment rights either.

In the mean time, as my noble friend Lord Gavron indicated, senior executives in large companies are helping themselves to large salaries and even larger bonuses. In my view, the answer should be a collective one—trade union organisation—and the right of employees to representation. That is not envisaged in the Bill but it should be.